What are the consequences for a Nothing Bundt Cakes franchisee who fails to maintain insurance?

According to the 2025 Nothing Bundt Cakes Franchise Disclosure Document, if a franchisee fails to maintain insurance or fails to repay Nothing Bundt Cakes for insurance payments made on their behalf, or if they otherwise fail to adhere to the requirements of Section 13 of the franchise agreement, it constitutes a breach of the agreement.

This failure to maintain adequate insurance coverage provides Nothing Bundt Cakes with grounds for terminating the franchise agreement. Termination of the franchise agreement means the franchisee would lose the right to operate their Nothing Bundt Cakes bakery.

Maintaining adequate insurance is a standard requirement in franchising to protect both the franchisee and franchisor from potential liabilities and financial losses. Franchisees should carefully review Section 13 of the franchise agreement, as referenced in Item 23, to fully understand the specific insurance requirements and ensure compliance to avoid potential termination of their franchise agreement.